Gibraltar Launches Financial Services License for Blockchain

TR Reuters have reported that Gibraltar’s financial services watchdog will introduce the world’s first bespoke license for “fintech” firms using blockchain distributed ledger technology as of next month in a bid to attract start-ups to the British overseas territory as it prepares for Brexit.

The report goes on to say

The Gibraltar Financial Services Commission (GFSC) will publish guidance on Friday for applying its new law for firms that use blockchain to “transmit or store” cash and assets belonging to others – much in the same way as a bank is authorized.

“This is the first instance of a purpose-built legislative framework for businesses that use blockchain or distributed ledger technology,” Nicky Gomez, the GFSC’s head of risk and innovation, told Reuters.

Other regulators in the United States and Japan have introduced rules focusing on cryptocurrencies or for the exchanges that trade them.

“Many firms have been craving for a jurisdiction to regulate them,” Gomez said.

Blockchain, which first emerged as the architecture underpinning cryptocurrency bitcoin, is a shared electronic database that updates itself in real time and can process and settle transactions in minutes using cryptographic computer algorithms with no need for third-party verification.